Question 3: Hitech Industries Inc., a Canadian company, entered into the following transactions during 2015: On January 2, the company borrowed US $2,000,000 from an American bank with the principal amount, together with interest at 5%, repayable on January 1, 2016. On April 1, the company purchased some machinery from an American supplier at a cost of US $400,000 with payment due on May 31. The equipment had an estimated useful life of ten years and no residual value expected at the end of that time. On December 31, 2015, the supplier's selling price for the equipment had dropped to $380,000. On July 2, the company bought 10,000 shares of American Industries Ltd. common stock at a price of $10 U.S. per share, paying cash on that day. The investment was reported at fair value with revaluation gains and losses through profit and loss. Shares of American Industries were trading for $11.50 at December 31, 2015.